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Family Business Management –  Syllabus Fall 2011

MGMT-GB.2328.10 Page 1 of 4

 NEW YORK U NIVERSITY 

LEONARD N. STERN SCHOOL OF BUSINESS-GRADUATE DIVISION Department of Management and Organizations

Family Business Management Syllabus

MGMT-GB.2328.10

Fall Term 2011

Thursdays 6pm-9pm(No Class Sept 29 or Nov 24)

Professor: Roger Healy email: rhealy@stern.nyu.edu Room: TBA

Course Description:

In the US, family businesses account for 85% of private sector employment. One-third of theS&P 500 and approximately 80% of the world’s businesses are family businesses. Manystudents will lead successful careers in or with family businesses. Careers in investment

 banking, wealth management, consulting and management all depend to some extent on family

 businesses. This course promotes the continuity of successful family businesses and provides theknowledge necessary to support those families for whom continuity of family in business is a

strategic objective. The best practices examined provide a road map to enable the family

 business to avoid the universal “shirt sleeves to shirt sleeves in three generations” proverb. 

The course investigates the unique characteristics that allow family businesses to create

inimitable competitive advantages that result in their outperformance of non-family businesses.

The issues and risks which lie at the intersection of ownership, control, and management offamily businesses and the practices necessary to ensure effective optimization of all of the family

 business subsystems for the long-term benefit of the family business will be explored.

The experiences of many families will be brought to bear on issues of family control, non-family

management, next-generation talent and development, estate and tax planning, wealth

management concerns, philanthropy and family business financing.

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Family Business Management –  Syllabus Fall 2011

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Course Objectives:

  Understand the qualities which typify family businesses;

  Appreciate family businesses’ unique capacities and potential for superior returns; 

  Understand developmental needs of family members at various stages of the businesses;

  Develop the management and communication skills to build trust and understanding; and

Identify and cope with foreseeable obstacles to continuity of a family business.

Course Methodology and Classroom Etiquette

The case study method requires that each student comes prepared to each session. Implicit in

this methodology is the requirement for adequate time to be devoted to the preparation of each

case before class. The cases will form the basis of class discussion. It is recommended that

written answers to the questions provided be prepared for the students use in class. Questions forcase 1 & 2 are provided below. Questions for the remaining cases will be provided in class.

The submission of written assignments for certain cases will be required. Those cases will be

designated in advance. Case assignments will be 3-5 pages typed, 12 point, double spaced withnormal (1 inch) margins and must be readable by Microsoft Word. Case assignments are to be

emailed before class is scheduled to begin. Late submissions will not be accepted.

A Term Paper will be required. Term paper assignments will be provided in class.

Active and respectful participation in class discussions is required and will determine a

significant proportion of the grade. Thorough preparation of cases will enable students to participate fully in class discussions. The evaluation of approaches suggested by others and

 building on those approaches with constructive commentary will earn high marks for class

 participation.

 Name card should be displayed in each class and students should remain in their chosen seat for

the duration of the course.

Changes may be made to the syllabus. Any changes will be communicated to students directly.

Conduct: The NYU Stern Code of Conduct applies. If necessary, please re-familiarize yourselfwith the code (http://www.stern.nyu.edu/UC/CurrentStudents/CodeofConduct/CON_022122 ).

Grading:

Class Participation 20%

Case Assignments 40%Term Paper 40%

Course Materials:

(1)   Family Business, 3rd 

 Edition by Ernesto J. Poza, South-Western Cengage Learning

(N.B.: Kindle and other versions may not include all material)(2)  Case Packet for Family Business Management

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Family Business Management –  Syllabus Fall 2011

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Course Schedule and Case Questions:

Session 1 –  Sept 22 –  Characteristics of Family Businesses

Reading: Chapter 1, Family Business, 3rd

 Edition, Poza

Case 1: 

 Pitcairn Family Heritage ® Fund  Case 2:   Anderson Steel Service, Inc. 

THERE WILL BE NO CLASS ON THURSDAY SEPT 29

Session 2 –  Oct 6 –  Successful Family Businesses

Reading: Chapter 2 & 3, Family Business, 3rd

 Edition, Poza

Case 3:   Harilela Enterprises

Case 4:  The Graham Family and the Washington Post Co. 

Session 3 –  Oct 13 –  Building Understanding and Trust

Case 5: 

The Khalil Abdo Group Case 6: 

 Bentington Industries 

Session 4 –  Oct 20 –  Next Generation: Renewing Entrepreneurship

Reading: Chapter 4, Family Business, 3rd

 Edition, PozaCase 7:   Keddeg Company (A) 

Session 5 –  Oct 27 –  Estate Planning, Trusts and Other DevicesReading: Chapter 7, Family Business, 3

rd Edition, Poza

Case 8:  The Fojtasek Companies and Heritage partners: March 1995

Case 9:  Ottawa Devices, Inc. (A) 

Session 6 –  Nov 3 –  Valuation

Reading: Chapter 8, Family Business, 3rd

 Edition, Poza

Case 10:   Kohler Co. (A)Case 11:   Ayala Corporation 

Session 7 –  Nov 10 –  Strategic Planning and Non-Family Managers

Reading: Chapter 9, Family Business, 3rd

 Edition, PozaCase 12:  Stevenson Industries (A)

Case 13:   Donald Salter Communications

Case 14:  Cross Country group: A Piece of the Rock (A)

Session 8 –  Nov 17 –  Family Business Governance

Reading: Chapter 10, Family Business, 3rd

 Edition, Poza

Case 15:   Adelphia Communications Corp.’s Bankruptcy Case 16:   Ford Motor Company’s Value Enhancement Plan (A) 

THERE WILL BE NO CLASS ON THURSDAY NOV 24

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Family Business Management –  Syllabus Fall 2011

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Session 9 –  Dec 1 –  Family Management - Human Capital

Reading: Chapter 11, Family Business, 3rd

 Edition, Poza

 Integrating the daughter into family business management   (Case Packet)Case 17:   Precista Tools AG (A)Case 18:   J. Perez Foods (A)

Session 10 –  Dec 8 –  Leading the TransitionReading: Chapters 5 & 6, Family Business, 3

rd Edition, Poza

Case 19:   Atherton Clothing Company

Case 20:  Sam Steinberg (A) and (B) (Condensed)Case 21:   From Swords to Ploughshares: Three Generations of Family

 Entrepreneurship, Conflict, Transition and Connection

Session 11 –  Dec 15 –  Lessons from Centennial Family CompaniesReading: Chapter 12, Family Business, 3

rd Edition, Poza

Case 22:   Eu Yan Sang: Reviving a Traditional Family Business with Modern

 Business Principles 

Session 12 –  Dec 22 –  Global Family Businesses Roundup

FOR THE FIRST CLASS: Questions for Cases 1 & 2:Prepare answers to cases 1 & 2 for the first class. These answers will not be turned in but it is

recommend that students prepare written answers to these questions for class discussion.

Case 1:  Pitcairn Family Heritage ® Fund  

Questions:

1.  Would you invest in this fund? Provide three reasons for your answer.

2.  If you were to manage this fund, how would you modify the investment selectioncriteria (the philosophy must be preserved)

Case 2: Anderson Steel Service, Inc.Questions:

1.  What are the business, family, and ownership issues in the case?

2.  If you were Charles Anderson at the end of the case, what should you do?

 New York, July 13, 2011